CMHC said that deferrals comprised around 12% of Canadian mortgage holders. As of mid-May, 27% of all deferrals came from Quebec, and 26% were from Alberta.
Ontario represented 21% of those who put off their mortgage payments, while British Columbia accounted for just 7%.
In a statement to the Standing Committee on Finance last week, CMHC CEO Evan Siddall said that while the current deferrals set-up is a welcome reprieve for a consumer base already wrestling with significantly reduced incomes due to COVID-19, this does not come without its own risks.
If the Canadian economy does not restart on time, up to 20% of all mortgages could become delinquent accounts by September, Siddall said.
“A team is at work within CMHC to help manage a growing debt ‘deferral cliff’ that looms in the fall, when some unemployed people will need to start paying their mortgages again,” Siddall said. “As much as one fifth of all mortgages could be in arrears if our economy has not recovered sufficiently.”
This will represent yet another burden to the struggling Canadian financial system.
“Just as governments are taking on more debt to finance the COVID-19 response, mortgage deferrals are adding to already historic levels of household indebtedness,” Siddall said. “The resulting combination of higher mortgage debt, declining house prices, and increased unemployment is cause for concern for Canada's longer-term financial stability.”
MBN
We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.
Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome and rewarded!
No comments:
Post a Comment